When the Sales Price Per Unit Decreases,the Contribution Margin Per

question 59

Multiple Choice

When the sales price per unit decreases,the contribution margin per unit ________.

• A) increases proportionately
• B) increases
• C) remains the same
• D) decreases

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Definitions:

Deferred Tax Asset

An accounting term used to describe a situation in which a company has paid more taxes to the government than it has actually owed during a given period.

Deferred Tax Liability

A tax obligation arising from temporary differences between accounting and tax treatments of certain items, to be paid in the future.

Tax Deductible

Expenses that are subtracted from gross income to reduce taxable income, leading to a decrease in the amount of taxes owed.

Operating Expenses

Costs associated with the day-to-day operations of a business, excluding the cost of goods sold.